Curious Cat Management Improvement Library - Dictionary

Benchmarking - studying best practices in another organizations to learn how to improve the performance of your organization. Learning from those who have found better ways of working can be very helpful.

Copying ideas from one organization into another however, is fraught with risk (it can easily lead to tampering). The overall system within which the practice is used determine the success. What works in one organization's system will not necessarily work well in that of another organization.

The practice is not meant as (though it may often degrade to) a method to copy a practice used at one organization to another. In fact, it can be quite valuable to benchmark an organization that you can't simply copy ideas from but instead you learn from what they do and then apply it to your organization.

As an example, an airline might study a racing pit crew to learn how to quickly "turn around" (disembark the passengers, prepare the plane for another trip, embark passengers and takeoff again) a plane. You obviously can't just copy what the pit crew does, the processes are too dis-similar. However, the processes are similar enough that you can learn concepts (shared responsibility [for example, everyone in the crew can prepare the plane during turn around (flight attendants, captain, co-pilot...)], eliminate all non-value added steps, re-engineer to allow for speedy turn-around, etc.).

Related Terms:

Performance Benchmarking - Comparison number for the performance of other organizations at specific tasks. For example, Toyota requires X hours of labor to manufacture a car while Ford requires 25% more labor. This meaning can often be confused with the more complete process noted above. Performance Benchmarking, of this sort, is really just data to compare with.